ALJDEC decisions subject to certification as final

2012A-5334-ROC · Registrar of Contractors · 2013-10-08

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 18, 2013 APPEARANCES: Complainant Zilpha Shoultz Blair appeared on her own behalf. Respondents P V Contracting LLC and R P M Masonry and General Contracting Inc were represented by Tevis Reich. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________ FINDINGS OF FACT The Arizona Registrar of Contractors (“the Registrar”) issued License No. KB-2.264179-D to P V Contracting LLC (“PV”) and issued License No. B.168993- R to R P M Masonry and General Contracting Inc (“RPM”). The Registrar received a Complaint against PV from Zilpha Shoultz Blair (“Complainant”) alleging PV abandoned a contract for the addition of a master bedroom, bathroom, and deck. Complainant requested a hearing. The Registrar issued a Citation and Complaint against PV and RPM (collectively “Respondents”), charging possible violations of A.R.S. § 32-1154(A)(1) and A.R.S. § 32-1154(A)(13), namely A.R.S. § 32-1158(B). Respondents filed a timely written answer to the Citation and Complaint, denying any statutory violations. The Registrar referred the matter to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing, which was held on September 18, 2013. Hearing Evidence On or about January 23, 2012, Complainant entered into a contract with PV for the addition of a master bedroom, bathroom, and deck to her home for a total contract price of $78,608.00. The contract provided for an initial payment of $15,721.00 with the “balance due upon completion of % - draw system.” (Insp Complaint Submittal1.pdf p. 13). The contract did not include an estimated date of completion of all work to be performed under the contract or an advisement that the property owner had the right to file a written complaint with the Registrar. On or about January 23, 2012, Complainant provided Tom Blacketer, a PV employee, with a check for $15,721.00 made out to PV. (Insp Correspondence from Complainant5.pdf p. 1). On or about March 3, 2012, Complainant provided Mr. Blacketer with a check for $12,159.00 made out to PV. (Insp Correspondence from Complainant5.pdf p. 2). In March 2012, Mr. Blacketer passed away unexpectedly.[1] On or about March 26, 2012, Ronald Polder, Respondents’ Qualifying Party, met with Complainant. At that time, Complainant indicated that she had been working with Mr. Blacketer and was concerned that Mr. Polder was taking over without being familiar with her project. Complainant requested that Mr. Polder sign a new contract reiterating the terms of the contract she signed with Mr. Blacketer on or about January 23, 2012. Mr. Polder acknowledged that Mr. Blacketer had handled PV’s business and that Mr. Polder was largely unfamiliar with PV’s individual projects at the time Mr. Blacketer passed away. Mr. Polder used a form proposal from RPM as the contract crossing out the RPM name and writing “PV Contracting” above it. The contract provided that the total contract price was $78,608.00 with payments of $15,721.00 and $7,860.00 already paid to Mr. Blacketer leaving an outstanding balance of $55,027.00.[2] The contract indicated Complainant would make a payment of $20,000.00 at the time of the signing, a payment of $15,000.00 after rough framing, roof, and siding were finished, and payment of the remaining $20,000 to be agreed upon. On or about March 26, 2012, Complainant provided Mr. Polder with a check for $20,000.00 made out to PV. On or about April 18, 2012, Complainant provided Mr. Polder with a check for $10,000.00 made out to PV. At the time of the payment, the rough framing, roof, and siding were completed. In late April 2012, Mr. Polder requested a payment of $20,000.00 from Complainant. Complainant requested an accounting of how the funds she had paid toward the project had been expended. Mr. Polder refused to provide such an accounting. Complainant informed Mr. Polder that she was not confident Respondent could complete the job for the agreed upon price and that she would be unable to give Respondent any more funds. Mr. Polder assured Complainant that Respondent was ready, willing, and able to complete the project for the agreed upon price. Mr. Polder told Complainant that he did not have sufficient funds to hire an electrician and plumber and instructed Complainant to hire those contractors herself and pay them with the funds still owing on the contract. Complainant then began contracting directly for labor and purchased materials at full retail to complete the project. Even after Complainant refused to make further payments to Respondent, Respondent provided the labor for the installation of insulation and drywall and the painting of the interior and exterior. Complainant testified that she had spent $104,540.97 total for completion of the project, which was approximately $26,000.00 more than the $78,608.00 contract price she had with PV. PV presented the testimony of David Alan Luettjohann, Qualifying Party of Luecon, ROC License No. B.164062-R and B-2.276882-C, who estimated that his company would have bid the work completed by PV at the point Complainant stopped making payments at $65,250.00. PV presented the testimony of Gregory Cooney, Qualifying Party of Cooney Carpentry Inc, ROC License No. B.204631-R and B-2.227885-C, who estimated that his company would have bid the work completed by PV at the point Complainant stopped making payments at $73,916.77. CONCLUSIONS OF LAW 1. This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32- 1101 et seq. 2. Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). 3. Complainant failed to establish that RPM had any connection to the project in dispute other than that RPM and PV had the same Qualifying Party. Because RPM did not enter into a contract with Complainant, Complainant failed to establish that RPM abandoned the contract or refused to perform after submitting a bid on work without legal excuse for the abandonment or refusal in violation of A.R.S. § 32-1154(A)(1). 4. Complainant failed to establish that PV was unwilling or unable to perform the contract as agreed upon. In fact, Complainant admitted she did not abide by the terms of the contract when she paid only $10,000.00 to PV after the rough framing, roof, and siding were finished rather than the $15,000.00 payment required by the second contract she signed with Mr. Polder. The failure to pay the additional $5,000.00 may account for Mr. Polder’s statement that he did not have the funds available to pay the electrician and plumber and directing Complainant to pay those trades directly. Even after Complainant refused to make any more payments, PV continued providing laborers to work on the project as best it could. 5. The testimony offered by PV as to the value of the work completed indicated the work completed was worth more than the payments Complainant had made toward the contract. While this may lend credibility to Complainant’s belief that PV would be unable to complete the project on budget, it was not her place to predetermine its inability to do so simply because PV refused to provide Complainant with an accounting of expenses that Complainant did not establish that she was legally entitled to receive. 6. Therefore, Complainant failed to establish that PV abandoned the contract or refused to perform after submitting a bid on work without legal excuse for the abandonment or refusal in violation of A.R.S. § 32-1154(A)(1). 7. The contract signed with PV on or about January 23, 2012, did not include an estimated date of completion of all work to be performed under the contract, the dollar amount of any progress payment or the state of construction at which the contractor would be entitled to collect progress payments during the course of construction under the contract, or an advisement that the property owner had the right to file a written complaint with the Registrar. Therefore, Complainant established that PV violated A.R.S. § 32-1154(A) by its failure to comply with A.R.S. § 32-1158(B)(4), (8), and (9). 8. RPM’s form proposal used as the second contract with Complainant also did not have an advisement that the property owner had the right to file a written complaint with the Registrar. Therefore, Complainant established that RPM violated A.R.S. § 32-1154(A) by its failure to comply with A.R.S. § 32-1158(B)(9). RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Registrar’s final Order in this matter, the Registrar suspend License No. KB-2.264179-D previously issued to Respondent P V Contracting LLC until it corrects its forms to comply with A.R.S. § 32-1158(B). It is further recommended that if on or before the effective date of the Registrar’s Order, Respondent P V Contracting LLC provides written proof that is acceptable to the Registrar that it has corrected its forms to comply with A.R.S. § 32-1158(B), the Registrar should not suspend its license but, instead, shall close Complainant Zilpha Shoultz Blair’s Complaint in Case No. 2012-5334. It is further recommended that on the effective date of the Registrar’s final Order in this matter, the Registrar suspend License No. B.168993-R previously issued to Respondent R P M Masonry and General Contracting Inc until it corrects its forms to comply with A.R.S. § 32- 1158(B). It is further recommended that if on or before the effective date of the Registrar’s Order, Respondent R P M Masonry and General Contracting Inc provides written proof that is acceptable to the Registrar that it has corrected its forms to comply with A.R.S. § 32-1158(B), the Registrar should not suspend its license but, instead, shall close Complainant Zilpha Shoultz Blair’s Complaint in Case No. 2013-1641. In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be 40 days from the date of that certification. Done this day, October 8, 2013.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors

----------------------- [1] There was contradictory information provided at hearing as to when Mr. Blacketer died. Complainant indicated it was in mid-March 2012, while Respondents indicated it was late March 2012. The specific date of Mr. Blacketer’s death is not dispositive of any issue raised in the Complaint. [2] In the Complaint, Complainant stated she paid Mr. Blacketer $15,721.00 and $12,159.00 (Insp Complaint Submittal1.pdf p. 3); however, the second contract provided the payments made were $15,721.00 and $7,860.00. No testimony was offered to explain the inconsistency.

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